patching...
Update: Have you signed up for our newsletter yet? Get Patch news delivered to your inbox every morning. »
Welcome back, Patch Blogger!

Costco Subsidy in Question

New council members will not support the $4 million for construction of Costco in the Wheaton mall.

 

With budget work sessions approaching, some members of Montgomery Council Council are questioning a $4 million subsidy to Westfield for bringing Costco to the south side of the Wheaton mall.

The Washington Examiner reported that a portion of the County Council would oppose the subsidy and quoted council members Marc Elrich (D-At Large) and Craig Rice (D-District 2) as opposed.

Council Vice President Nancy Floreen (D-At Large) continues to support the subsidy, and changing direction, she said, would be the equivalent to going back on a promise.

"My view was the deal has been reached," Floreen said. "What we got out of it was the gas station part separated."

"It would be a shame if we reversed our commitment to move Wheaton forward," she said.

George Leventhal, an at-large council member believes the subsidy is a neccessary, if unpopular item to support.

"I've said it before, it's a bitter pill to swallow, but ultimately the best way to get out of a long-term budget crisis is to attract jobs and businesses." Leventhal said.

Councilmember Hans Riemer (D-At Large), who, in addition to Rice, was not part of the council's discussion on the subsidy last year, told Patch he won't support it.

"I think that we should postpone," Riemer said. "I think the money isn’t needed, and we need a better deal."

Riemer is not convinced that the vote that happened last year, in a private session, is representative of the council's full support.

Councilmember Phil Andrews (D-District 3) continues to oppose the subsidy, adding he was one of four votes against last year, all four of which are still current councilmembers - including council members Elrich, Valerie Ervin (D-District 5) and Navarro (D-District 4). 

Andrews said he cannot speak for the other "no" votes, but he has not changed his mind.

"I think it’s a tough sell period to subsidize Costco, but I think it’s an especially tough sell next to a Metro," Andrews said.

Steve W.

6:05 pm on Tuesday, April 19, 2011

My prayers that that subsidy be reconsidered that the deficit not be on the backs of people.

Reply

Darin Bartram

8:36 pm on Tuesday, April 19, 2011

Costco was just bluffing when they said they wouldn't put a store in Wheaton without a gas station, given that they are moving forward with the store without approval for the gas station. I can only assume they are bluffing when they say they won't put a store there without the $4 million taxpayer subsidy.

Reply
Comment_arrow

AntonFisher

9:39 pm on Tuesday, April 19, 2011

The subsidy is not for Costco. Westfield is getting the $4 million subsidy in order to construct a building that will house Costco. I do nto think that Costco is getting anything out of the deal with the County since they will be leasing from Westfield regardless of how the warehouse construction is funded.

Taylor Kate Brown

9:49 pm on Tuesday, April 19, 2011

DCGUY is correct - Westfield is the direct recipient of the subsidy for the specific purpose of construction for Costco. How that affects their leasing with Costco is another question. Thanks for the comment.

Reply

Danila Sheveiko

11:17 pm on Tuesday, April 19, 2011

@Steve, even without this EDF grant, Westfield and Costco will be receiving millions in tax credits from County and State because Wheaton is an Enterprise Zone
@Darin, you forget about the initial bluff - the "time" argument - originally they were saying Special Exception (the regulated way of applying for a gas station) would take too long, so it took us nearly a year to defeat a Zoning Text Amendment that would have fast-tracked the gas station as spot zoning, thereby bypassing the customary community input and additional environmental studies. So really, it's been a Texas-Hold-Em game the entire time.
@DCGUY, to be very specific, the $4M goes to Westfield for construction of the first floor underneath the Costco.
@Taylor Kate, how the County grant to Westfield affects leasing with Costco a good question indeed, considering Westfield and Costco signed a nation-wide deal.

Reply

Steve W.

5:04 am on Wednesday, April 20, 2011

@Danila, I agree with what you shared regarding your struggle with a Goliath, as I can recall years ago the struggles downtown, some won (Willard Hotel) and others lost (Rhodes Tavern), as I remember participating in the struggle to save our Tastee Diner in nearby Silver Spring, don't give up!

Reply

Walter Lee

7:17 am on Wednesday, April 20, 2011

I wasn't in favor of Costco having a gas station, but I am in favor of the store. If anyone has ever gone to a Costco store they would see the number of people the company has working in them. In today's economy and national high unemployment rate, I believe growth is what we need now. Also, if we look at Montgomery County's record for attracting new big businesses and corporations, one would soon see that they are losing out constantly to neighboring Virginia. What are these council members who oppose the store doing to bring jobs and revenue to the county. You can't just keep raising taxes.

Walt

Reply
Comment_arrow

Danila Sheveiko

12:00 pm on Wednesday, April 20, 2011

Walter, I don't think there are too many CMs against the Costco store itself. As to the jobs... If Costco will bring so many jobs, why remove the job creation and monitoring clause from the EDF grant? Why our local County businesses have to be monitored for job creation while Costco gets to skate? Costco was allowed to come to East Harlem, even though overnight delivery trucks would enter through a residential neighborhood, because they promised to create jobs. Unfortunately, they cut 160 of those jobs barely two months after opening... Furthermore, Costco does not pay nearly enough to support a family in our County, but is party to Wal-Mart's gender discrimination case - the largest class-action lawsuit in history. Additionally, Costco is facing an overtime suit which alleges that employees were routinely locked inside stores after hours without compensation. Finally, Costco was rated as least sustainable retailer in Canada, and is skirting environmental regulations here in Wheaton.

Chip Py

8:41 pm on Wednesday, April 20, 2011

I don't really buy into the whole "Jobs"thing tied to this project. Costco pays between 11 and 16 dollars and hour. Which is pretty good in terms of retail jobs and they have a good reputation as a place to work. But let's then break that down. A forty hour work week and the high end pay scale will put you at $640 a week or 2560 a month. Lets take out taxes and social security say 28% which leaves you with $1843.20 for the month. Now let's go rent and apartment in Wheaton. Archstone in Wheaton (right across the street from Coscto) there you can get a One bedroom apartment for between $1549 and $1866 (look this up on For Rent.com) That should leave you nothing after rent for food, transportation, healthcare. So you can get some Food Stamps, perhaps a rent subsidy and if you get hurt you can go to one of the county health care facilities. So my point is that it costs a lot to live here in Montgomery County and we need to create jobs that pay better. Even creating upscale retail jobs like Costco is really just creating well .....POVERTY!

Reply

Darin Bartram

10:34 am on Thursday, April 21, 2011

Long before the Montgomery County Council gives Costco/Westfield (really--the distinction here is irrelevant) a $4 million subsidy, they ought to invest in traffic improvements so that the pathways to Wheaton Mall can accommodate the increased traffic that Costco will cause. If you've ever tried to go to Wheaton Mall during the week before Christmas, you have a glimpse of the load that a high-demand store like Costco will create--year round.

Reply

Steve

4:10 pm on Thursday, April 21, 2011

Please, we are laying off our school's music teachers to give $4 Million to an Australian company so that they can bring a super-big box category-killer that will displace our local businesses and gas station owners? Council members who for this can be assured that we'll make sure that you're not elected again....

Reply

AntonFisher

4:15 pm on Thursday, April 21, 2011

People in Wheaton want Costco. I am for the subsidy if it means getting business into Wheaton. Enough help goes to Bethesda and Ptomac. It is time to rejuvenate Wheaton, whatever it takes. Learning music is a privilege, living in a nice area is a right.

Reply
Comment_arrow

Steve

5:52 pm on Thursday, April 21, 2011

Wheaton's local business is Music. Who are going to buy musical instruments from Chuck Levin if students are not taking classes in Montgomery County Schools? We are killing a local Wheaton tenant to support a multinational conglomerate.

Comment_arrow

Danila Sheveiko

12:45 am on Friday, April 22, 2011

Dear DCGUY: How sure are you that everyone in Wheaton wants Costco to come? Filippo Leo, owner of Marchone's Italian Deli, told the Washington Examiner: "If Costco comes here, we will not survive. It's like Wal-Mart. Wherever these big chains go -- mom and pop stores, they die off."

Steve

5:50 pm on Thursday, April 21, 2011

DCGUY - you obviously do not understand Wheaton. The key anchor tenant for Wheaton IS MUSIC! Who are going to be Chuck Levin's customers if students in the schools do not have music classes anymore? $4 million to Westfield = $4 million fewer customers for musical instruments = empty locally based retailer.

THIS IS WRONG!!!!!!!

Reply

AntonFisher

6:07 pm on Thursday, April 21, 2011

I would love to believe that music students at Wheaton's schools are the ones keeping Chuck Levin's open. But probably Wheaton schools music students combined don't have purchase power equal to a few shoppers from outside Wheaton who will be driving to shop at Wheaton Costco. Maybe it is time that we look at the bigger picture and support sustainability of a town. I like Chuck Levin's, font get me wrong, but there is no sense in turning down business that will resurrect a town in order to protect a privilege that very very very few students at Wheaton's schools enjoy. If the $4mil will for sure be invested in Wheaton and only Wheaton, then I will say yea heck with the county subsidy to Westfield to build for Costco. I just want the 4 millions to benefit mostly the Wheaton area.

Reply
Comment_arrow

Danila Sheveiko

12:57 am on Friday, April 22, 2011

Dear DCGUY: I agree with you that Wheaton needs money and attention, but thinking that Costco will somehow be the magic silver bullet that will save Wheaton is... unrealistic, to put it bluntly. The current Costco proposal goes against the new Wheaton Sector Plan's core principles of connected, mixed-use, pedestrian-friendly environments. Also, I don't think Costco will appreciably increase patronage of Central Business District businesses - most people rush to Costco and buy frozen foods, which can't just sit in your trunk while you are staying for a dinner and a movie. Do you think I am exaggerating? Costco even has special trunk coolers at some of their stores, and ours will have a little kiosk next to entrance with brochures from CBD businesses. If you like Costco so much, you must have visited the Beltsville location - ever read brochures or patronized any other stores there? I doubt it. Do you really want Wheaton to look like Beltsville?

AntonFisher

8:23 am on Friday, April 22, 2011

@Danila I don't love costco, don't shop there, don't have a membership and don't plan to shop there when they open at the mall. If costco doesn't come, what other alternatives do we have. We need more businesses to come to wheaton, but we failed to attract any new business to the area. To be honest,i feel very intimidated going into these small businesses in downtown wheaton and never go there to shop. If there isn't any chain that I'm familiar with that attracts me to go to downtown wheaton, I probably will not get accustomed to those little shops there. They all look tired and not inviting. They give a message to me that if they don't care about the appearance of their shops from the outside, why would they care about me or the quality of products they have. For now, I will stick to shopping at chain stores until maybe one day I feel invited to shop at those shops in downtown wheaton.

Reply

Lo

3:52 am on Saturday, April 23, 2011

One of the things that makes Wheaton interesting is the fact that it's not riddled with a bunch of chain stores and chain restaurants (aside from the mall, of course). It's an ethnically diverse area with lots of mom and pop shops and I would hate to see that vibe die in order to make way for all the cookie cutter shops that dominate lots of other MoCo areas. No question - Wheaton needs a facelift and its economy needs revitalization but I hope it's done tactfully, innovatively, and CREATIVELY and not just hastily and half-assed. Tact, innovation and creativity don't really belong in the same sentence as Costco. It really isn't a good choice given the plan to make Wheaton walkable and mixed-use. Bottom line is that Wheaton has soul. It has SO much potential to be an interesting, funky, great place and Costco is one of the most soul-less and least innovative establishments in this country.

Reply

steve

1:02 pm on Saturday, April 23, 2011

I've lived here, grown up here and have a business here. All I hear talk, talk talk . Whats really interesting is everybody is talking about the 4 million dollars. Here's a question for all opposed because they feel it's to much money, who put in the money to build the facades along ga ave, who paid for all new windows in the back of the stores along triangle lane, who paid for the sidewalks from dunkin donuts on up, who paid for the new parking lots on ga ave, who paid to have all the sidewalks and driveways torn up to put the pepco lines underground and run to the stores only to discover they can't do it, who paid to have Barrys magic shop removed and than paid Barry to move to Rockville.
Money is not the issue. Costco is a small piece, if they succeed other stores will follow and Wheaton will grow. None of the 22+landlords have said anything they stand to make alot more money off the decisions of others these are cash cows and all they want is for others to pay for the improvements and they will gain the rewards.

Reply

The K's

3:36 pm on Saturday, April 23, 2011

I applaud the Council for blocking the $4 million grant to Westfields/Costco. I think it makes more sense to use that money toward Montgomery County's much-needed services. Costco does not need the cash! Quarterly earnings of this company are in the billions ($18 to 20 billion every quarter). Westfields earned over $2 Billion, last year.

We should not sacrifice scarce tax dollars to services for a store to open in Wheaton, with a $4 million grant. They don't need the money but our county services surely do!

Reply

AntonFisher

11:22 am on Monday, April 25, 2011

The big picture to all of those who are opposed to Costco.... Another article from Gaithersburg Patch that might clarify and maybe persuade you to change your minds.

http://gaithersburg.patch.com/articles/missing-the-big-picture-on-costco

Reply

Jason

11:24 am on Monday, April 25, 2011

If Costco decided not to come, would the $4 million over two years be earmarked to go to other projects to benefit Wheaton?

Reply

AntonFisher

11:30 am on Monday, April 25, 2011

@Jason I doubt that if the $4 million subsidy does not go to Westfield to lure Coctco, Wheaton may never see that money. If those Council members are really concened about Wheaton, then if they take the Costco subsidy away, they should allocate the $4 million for other initiatives in wheaton and only in WHEATON.

Reply

Bill Burns

12:27 pm on Monday, April 25, 2011

Costco is coming, with or without the subsidy. The location is just too good. It's the closest a Costco will be able to to get to the lucrative NW DC market and it is at the intersection of three major thoroughfares. Location, location, location! Unfortunately for Wheaton, the Costco will be plunked down in the middle of a residential area. There's a good reason Costco's are located in industrial areas. No one will be going to the local businesses if they can't get to them due to gridlock. Westfield and Costco are doing what giant businesses do, negotiating for the best deal they can get. They do this full time and employ hundreds, if not thousands, of people to focus on this. Neither company really needs the money, but it's worth the effort trying to get it. And for those who think Costco won't continue to pursue the gas station for many many years to come, dream on! As a long time Wheaton resident, I can also tel you that there is considerable opposition to the Costco among Wheaton residents, gas station or not. A large part of the problem is the lack of information and the continuing propagation of misinformation.

Reply

Steve W.

5:06 pm on Monday, April 25, 2011

Costco and Westfield revenue iIF approved should benefit Wheaton AND Kensington, due to That Mall straddling boundaries of both communities, otherwise I can'y conscientiously support any subsidy...a compromise is worth looking into.

Reply

AntonFisher

5:53 pm on Monday, April 25, 2011

Agreed..When I said Wheaton, I mean the surrounding area, which absolutely includes Kensington. I just want to make sure that the subsidy, if removed from Westfield Costco in Wheaton, doesn't go to fund a park in Patomac or a project in Chevy Chase.

Reply

AntonFisher

2:14 pm on Tuesday, April 26, 2011

I had a revelation overnight... I am opposed to the County subsidy to build for Costco at Wheaton Mall. I would like to see the county divert that money to the 12 business owners of the Glenmont Shopping Center, located at the northeastern corner of Randolph and Georgia. For sure, the subsidy there will better serve the community, 12 small real-estate owners, and a couple dozens of businesses that are in the shopping center.

Reply

Jason

11:27 pm on Tuesday, April 26, 2011

I agree that Wheaton should mean Wheaton and Kensington when it comes to the mall. As for giving 12 small real-estate owners $, I don't see how that will make that strip mall much better unless they bring back the duckpin bowling!

Reply

Steve W.

4:49 am on Wednesday, April 27, 2011

@Jason good point on that duckpin bowling, that's one of the places I went to in the 70s, also don't forget the Stained Glass Pub there if Costco would go to Glenmont in lieu of Wheaton.

Reply

lilkunta

4:43 pm on Wednesday, April 27, 2011

About damn time! I HAVE BEEN AGAINST THE SUBSIDY ALL ALONG! MoCo gave Westfield a subsidy and built the new parking garage on University(behind the CVS where the used to be). Westfield--who banned us from having fireworks @ the may a few years back-- benefited. Westfield opened a Macys, closed the Hechts, and Im sure is charging Macys more rent since Macys has its own parking garage. What did Westfiled do in turn as a thanks? Nothing!

If Westfield wants Costco to come WESTFIELD NEEDS TO PAY FOR THE RENOVATIONS/ADDITIONS ITSELF. Not Montgoemry County taxpayers! Afterall Westfiled is reaping the most benefit.

@ yes definitely a new traffic pattern is def needed. The weeks leading to Xmas the Viers Mill Rd entrace looping road from ballys to Target is packed packed packed.

Reply

Leave a comment